NIFHA welcomes the Assembly debate on the delivery of new social and affordable housing. The sustainable supply of social and affordable housing to meet growing need is a significant concern for NIFHA and our members. In 2014/15 housing associations will increase delivery of social homes by over 50% from 1,300 to 2,000 new starts. It must be noted though that it would be virtually impossible for any developer – housing association or private sector – to significantly increase their development programme over the next year or even two years at the levels indicated in the Assembly motion.
The following points are intended to help inform consideration of this important issue:
- Housing associations are responsible for the development of all new social housing through the Social Housing Development Programme and affordable housing, primarily through Co-ownership Housing Association
- Housing associations have consistently met the targets set by government for new social and affordable housing
- NIFHA and our members recognise the need for increased development to meet identified housing need and we are committed – in partnership with the Department for Social Development and the Northern Ireland Housing Executive – to doing whatever we can to boost the delivery of new homes
- Housing associations do, however, face a number of obstacles in relation to the development of new social housing in particular. These include:
- Planning
- The planning system in Northern Ireland does not support the delivery of social housing. Housing associations in other parts of the UK see at least half of all new social housing provided through planning conditions; equivalent measures are not available to housing associations in Northern Ireland. The planning process itself is time-consuming and prescriptive and the requirements of agencies like the Northern Ireland Environment Agency add significant delay and cost into the development of new homes.
- Procurement
- Northern Ireland has gold-plated EU legislation and UK regulations in relation to procurement activity. Housing associations can no longer operate design and build contracts which significantly enhanced their ability to deliver new social homes at scale. They are also forced to operate within layers of bureaucracy, prescribed buying groups and even the form of contracts they are allowed to use is mandated by government. None of this enables a flexible, responsive and value for money approach to procurement and in turn makes development a more complex, expensive and lengthy process.
- Access to land for development
- Land remains difficult to access. Public sites are sold at best value and housing associations are often unable to pay the prices expected by government. Many privately owned sites are still held by NAMA and the banks. Housing associations can only develop social homes in areas of housing need and there may not be appropriate sites in these areas.
- Financial viability
- Housing associations do not develop new social housing to make a profit. In many cases associations make a loss on particular schemes. However, the financial viability of a new social housing scheme is a key factor in deliverability. Grant rates in Scotland and Wales have increased in recent years, to around 60%, in recognition of the fact that substantial public subsidy is required to develop social housing. Private finance plays an important part in enabling development and housing associations in Northern Ireland are successfully bringing significant amounts of bank and bond funding to new schemes. However, increased delivery is likely to require increased levels of grant and TCI.
- Opposition to development
- Even when a site has been acquired and the appropriate finance is in place, development can still be halted by opposition to social or supported housing from the local community. Housing associations will work with the community on planning issues to resolve concerns about design, access and infrastructure; however, there is little they can do to persuade communities to accept social housing where opposition is grounded in ‘nimbyism’.
NIFHA and our members are working closely with colleagues in government, elected representatives, the Housing Executive and the private sector to address many of these issues and find solutions that will enable increased delivery of new social and affordable housing. We believe that the following actions could unlock delivery and help housing associations to develop more new homes to meet housing need:
- Planning
- The Strategic Planning Policy Statement offers an important opportunity to put housing at the heart of the planning system and to ensure that adequate provision is made for social and affordable housing within development plans. Robust zoning, key site requirements and full use of planning conditions would allow increased levels of social housing to be built and adequate supply of development ready sites.
- Procurement
- Reversing the decision taken to suspend negotiated design and build contracts would have a significant impact on the ability of housing associations to deliver new social housing. We also need greater flexibility and autonomy in relation to procurement more generally, acknowledging that housing associations – whilst treated as public bodies for the purposes of procurement – have to be able to operate differently to the public sector. As long as housing associations comply with EU legislation and UK regulations we believe that they should be able to take their own procurement decisions.
- Access to land for development
- A decision by the Northern Ireland Executive and Assembly to prioritise the disposal of all surplus public sector sites for new social and affordable housing development would significantly enhance the potential for associations to seriously increase levels of delivery. Instead of unrealistic valuations and a determination to secure best financial value, we would favour a holistic approach that recognises new social and affordable housing development as a key Programme for Government commitmentand fully utilises all government resources accordingly to get Northern Ireland building.
- Financial viability
- We would ask members of the Assembly to consider increasing the rates of public funding available for new social and affordable housing. While housing associations can and will continue to maximise their capacity to lever in private finance to support increased levels of development, sustaining higher levels of delivery will be reliant on increased grant rates.
- Opposition to development
- Communities should be consulted on new housing development – public or private – and have an opportunity to express their views and concerns. We also believe that all possible efforts should be made by housing associations to assuage reasonable concerns raised by local communities and their elected representatives. However, we do not feel that it is fair or just for developments to be opposed simply because the occupants of intended new homes will be social tenants. Increasingly housing associations are being forced to delay or in some cases abandon development in areas of high social need, where sites and finance have been secured, because of the levels of community resistance to social housing. This is a sensitive issue and NIFHA appreciates the need to allow for democratic and due process. In a housing crisis strong leadership will be required to make the case for development and support new social and affordable housing. We believe that a united position across all political parties at all levels would help housing associations to deliver much needed homes in the areas and at the scale necessary.
Northern Ireland should be ambitious in developing new social and affordable homes to meet housing need. NIFHA welcomes this focus on the targets set for delivery and the call for more construction activity, more new housing development and ultimately the provision of homes and support for those most in need. We believe that addressing some of the issues outlined above would enable housing associations to do more in delivering much-needed social and affordable housing.
If you have any questions in relation to this briefing paper or would like further information in advance of the Assembly motion, please contact:
Cameron Watt
Chief Executive
T: 028 9089 7693
M: 07734 157038
Jennie Donald
Deputy Chief Executive
T: 02890 89 7698
M: 07947516109